Starting on October 20, 2024, Alberta will implement significant increases in land transfer and mortgage registration fees. “These hikes stem from amendments to the Land Titles Act and the Tariff of Fees Regulation, outlined in Alberta’s spring budget,” says Shounak Mehta, Founder of Juriscorp Law. Our residential real estate lawyers in Edmonton explain the impact and what you should do to address this.
What Do the Changes Look Like?
Currently, fees are based on a $50 base fee, with land transfer fees set at $2 per $5,000 of property value and mortgage registration fees at $1.50 per $5,000. After the changes, both will rise to $5 per $5,000 of property value.
This means for a property valued at $1,000,000, land transfer fees will jump from $450 to $1,050, and mortgage registration fees will increase from $350 to $1,050.
Alberta’s Land Transfer and Mortgage Registration Fees: Before and After October 20, 2024
Property Value | Land Transfer Fee (Before) | Land Transfer Fee (After) | Mortgage Registration Fee (Before) | Mortgage Registration Fee (After) |
$250,000 | $50 + ($2 * 50.0) = $150 | $50 + ($5 * 50.0) = $300 | $50 + ($1.5 * 50.0) = $125 | $50 + ($5 * 50.0) = $300 |
$500,000 | $50 + ($2 * 100.0) = $250 | $50 + ($5 * 100.0) = $550 | $50 + ($1.5 * 100.0) = $200 | $50 + ($5 * 100.0) = $550 |
$750,000 | $50 + ($2 * 150.0) = $350 | $50 + ($5 * 150.0) = $800 | $50 + ($1.5 * 150.0) = $275 | $50 + ($5 * 150.0) = $800 |
$1,000,000 | $50 + ($2 * 200.0) = $450 | $50 + ($5 * 200.0) = $1,050 | $50 + ($1.5 * 200.0) = $350 | $50 + ($5 * 200.0) = $1,050 |
* This table is illustrative of how the revised fee can affect buying/selling costs, it is not meant to be an accurate estimate or assessment of the fees you may be liable for. For an accurate, up-to-date estimate of the costs of selling or purchasing property, please reach out to our real estate lawyers in Edmonton or speak to your realtor.
If you’re in the process of purchasing property or registering a mortgage, you may want to expedite your transaction. For first-time home buyers, it’s all the more reason to take advantage of all the incentives available to you.
Closing before October 20, 2024, will allow you to benefit from the current lower fee structure. This could result in substantial savings, especially for higher-value properties or mortgages. For those unable to meet the deadline, it’s important to budget for these increased costs.
Will the Increased Fees Have a Significant Impact?
While the fee increases may cause buyers and sellers to feel an immediate financial pinch, the overall cost remains modest in the context of large property purchases or substantial mortgage loans.
For most buyers, the increased fees are unlikely to deter purchasing decisions, but they will add to the already rising costs associated with homeownership, including higher interest rates and inflationary pressures.
Sellers may also experience some knock-on effects, as buyers might factor these increased fees into their overall transaction costs, potentially impacting final sale prices or the speed at which properties are sold.
In short, while the increased fees will add to the financial burden, they’re unlikely to be the tipping point for most buyers and sellers in Alberta’s real estate market. However, it’s always advisable to factor them into your financial planning to avoid any surprises during closing.
Speak to Your Real Estate Lawyer on How You Can Reduce Your Liability
At Juriscorp Law, we specialize in ensuring that all aspects of your transaction, from document review to compliance with Alberta regulations, are meticulously handled.
Our team provides personalized guidance throughout the home buying or selling process, helping you avoid common pitfalls such as missed deadlines, unclear terms, or unforeseen costs like the new land transfer and mortgage registration fees.
Whether you are a property owner, prospective buyer, or realtor in Alberta, reach out today. Our residential real estate lawyers in Edmonton can advise you on how you can reduce your closing costs and maximize the value of your property.